Balance of risks for the Dollar before US NFP looks slightly tilted to the upside – ING

Source Fxstreet

US data still holds keys to direction and volatility in FX; Friday's Nonfarm Payrolls data may confirm January’s spike was an outlier, economists at ING say.

Waiting for a volatility shake-up

US data continues to hold the keys to FX volatility. At the end of this week, the February jobs report will tell us to what extent the stellar January numbers were an outlier. ISM and NFIB numbers before that will help us and the market formulate expectations for Friday’s release, but for now our US economist expects payrolls to come in at around 200K, in line with consensus. That would still be higher than the 185k consensus call for the January release. Investors have been forced to an upward revision on the US labour market. However, a return to the 200K area would put the series on a more sustainable trend and more consistent with expectations of summer cuts by the Fed.

On Wednesday and Thursday, Fed Chair Jerome Powell will testify before Congress. A dovish change in narrative does not look very likely given the latest inflation data, and a cautious wait-and-see approach should be reiterated – but may fail to impact markets too much given the proximity with jobs data.

The action in the US calendar starts on Tuesday. Today, things look quiet across the board in developed markets, and we could see more low-volatility price action from last week. Still, the balance of risks for the Dollar before US payrolls looks slightly tilted to the upside and DXY could find some good support above 104.00.

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
Crude Oil Price Forecast: Can Brent Hold $100 Amid Hawkish Fed Rate Hikes and Easing Supply Concerns? International oil prices continued to fall after the Federal Reserve resumed rate hikes in September. On Wednesday, WTI crude dropped 3.28% to settle at $102.02 per barrel; Brent crude fe
Author  TradingKey
13 hours ago
International oil prices continued to fall after the Federal Reserve resumed rate hikes in September. On Wednesday, WTI crude dropped 3.28% to settle at $102.02 per barrel; Brent crude fe
placeholder
Dow drops 631 points as the Fed hikes — but futures are rebounding: what's next for US stocks?The Dow fell 631 points and the S&P 500 closed below 7,600 after the Fed hiked rates for the first time since 2023, with the dot plot showing 16 of 18 officials expect more tightening. Asia-session futures are already recovering — here are the levels and analyst views that decide whether 7,500 holds.
Author  Irene Q.
20 hours ago
The Dow fell 631 points and the S&P 500 closed below 7,600 after the Fed hiked rates for the first time since 2023, with the dot plot showing 16 of 18 officials expect more tightening. Asia-session futures are already recovering — here are the levels and analyst views that decide whether 7,500 holds.
placeholder
Dollar index tops 100 for the first time since July as the Fed's hawkish dot plot sinks inThe U.S. dollar index broke back above 100 for the first time since 31 July after the Fed delivered its first rate hike since 2023, with the dot plot showing 16 of 18 officials expect at least one more increase this year. Here are the levels that matter for DXY, the currencies feeling it most, and what to watch next.
Author  Irene Q.
20 hours ago
The U.S. dollar index broke back above 100 for the first time since 31 July after the Fed delivered its first rate hike since 2023, with the dot plot showing 16 of 18 officials expect at least one more increase this year. Here are the levels that matter for DXY, the currencies feeling it most, and what to watch next.
placeholder
TradingKey Daily Market Briefing: Fed Raises Rates by 25 Bps, May Hike Again This Year; Gold Tumbles as Intel Rises 4%On September 16, Eastern Time, US stocks rose before pulling back following the Federal Reserve's rate decision announcement for September. The Fed unanimously decid
Author  TradingKey
21 hours ago
On September 16, Eastern Time, US stocks rose before pulling back following the Federal Reserve's rate decision announcement for September. The Fed unanimously decid
placeholder
September Fed Rate Decision Preview: Is a Rate Hike a Foregone Conclusion? US Stocks, Dollar, and Gold Face a Critical TestThe Federal Reserve will announce its September interest rate decision at 2:00 p.m. ET on Wednesday (September 16), followed by a press conference held by Fed Chair Kevin Warsh at 2:30 p.
Author  TradingKey
Yesterday 10: 14
The Federal Reserve will announce its September interest rate decision at 2:00 p.m. ET on Wednesday (September 16), followed by a press conference held by Fed Chair Kevin Warsh at 2:30 p.
Related Instrument
goTop
quote